Business week offers a look at the future of diesel vehicles in the U.S, partly by taking a look at Europes' offerings. The slide show showing what diesels are available in the U.S. is a nice touch too -- besides the article talks a little about "biodiesel" too.
They know that diesels provide superior fuel-economy without
sacrificing performance, as anyone who has ever had a diesel-powered
BMW blast by them on the autobahn
can attest. The main concern for most Americans is that the hangover
from the smoky, smelly diesels of the 1970s remains fresh in many minds
and many states have banned their sale. But changes in the supply of
diesel fuel, emerging cleaner-burning technologies, and growing
consumer concern over the environment and fuel economy in particular
are creating new opportunities for automakers willing to dabble in
diesel. So significant are the changes that market researcher J.D.
Power & Associates (MHP) forecasts diesel sales will nearly triple in the coming years, nabbing 11.8% of the U.S. market by 2015.
A driving force behind the growing potential for U.S. diesel is the
quality of the fuel being pumped by U.S. filling stations. American
diesel fuel has long been significantly dirtier than European blends,
emitting nasty particulates that are harmful to the environment.
Federal Mandate to Lower Sulfur
But last fall new federal standards came into effect mandating a
countrywide switch to low-sulfur diesel, which eliminates the dirty
soot. At the time, Environmental Protection Agency Administrator
Stephen Johnson said, "This is the single greatest achievement in clean
fuel since lead was removed from gasoline a generation ago."
Strict emissions standards in five states have confined sales of
past diesel models to only 45 states, excluding some of the country's
most lucrative markets, such as California and New York. The changes in
the fuel supply standards go a long way toward closing the gap between
cleaner diesel fuel and the toughest emissions regulations.
That's good news, since diesel models carry some significant
advantages over gas-sipping vehicles. Diesels are 20% to 40% more
fuel-efficient than the same models with conventional engines.
Pumping Biodiesel
Further greening diesel's prospects are several proposals in
Congress that would increase the national supply of biodiesel.
Presidential candidate Barack Obama has proposed a law that would pump
65 billion gallons of alternative fuels into U.S. tanks by 2025. Expect
to hear about many more alternative-fuel initiatives as the Iowa caucus
draws near.
Those kinds of economy improvements and policy changes could even
pose a challenge to the high-tech, gas-electric hybrids, including the
Toyota (TM) Prius and Ford (F)
Escape Hybrid, that have proved popular with consumers concerned about
the environmental impact of their driving. Diesels improve economy
while carrying a much smaller premium than hybrids. Mercedes-Benz (DCX),
a leader in U.S. diesels, says the premium for a diesel model like its
E-Class sedan is less than $2,000, compared with about $4,000 for a
hybrid.
Diesel also holds promise as a so-called alternative fuel that could
help the U.S. kick its addiction to foreign oil. According to EPA
estimates, if a third of American passenger cars ran on diesel, the
U.S. could save as much as 1.4 million barrels of oil per day,
approximately the amount of oil imported from Saudi Arabia.
And, unlike other alternative fuels, notably ethanol-based E85, the
diesel infrastructure is better developed. Approximately 40% of U.S.
filling stations offer the fuel, compared with only several hundred
that provide E85.
Cleaner Engines in the Pipeline
There's been a flurry of diesel development: Volkswagen and
Mercedes-Benz have been hard at work on cleaner-burning diesel engines
that reduce emissions. Mercedes has said it could begin selling
50-state models next year.
There are some compelling precedents for the rapid acceptance of
diesel when the market is right, namely, when consumers and
manufacturers are concerned about pumping up fuel economy. In Britain,
which long was cool on the fuel, sales of diesel vehicles have risen to
40% of car sales, up from about 15% in 2000.
Though Japanese companies have largely stayed away from the fuel, Honda (HMC)
made waves in 2003 by introducing an ultra-efficient diesel-burning
engine in European markets. Last fall the company said it would bring
its 2.2-liter engine, dubbed the i-CTDi, to Americans, likely by 2009.
Growing Demand
The Big Three also offer diesels but have mostly focused on workhorse trucks. Ford, General Motors (GM),
and DaimlerChrysler all offer full-size pickups with bawdy engines.
Only Daimler's Jeep brand offers a diesel passenger sport-utility
vehicle, the Jeep Grand Cherokee CRD.
Registrations for diesel-powered vehicles have risen in the past few
years, largely bolstered by the availability of such trucks. According
to R.L. Polk and the Diesel Technology Forum, registrations rose 80%
between 2000 and 2005, from 300,000 to nearly 545,000 vehicles. In the
light-truck market, diesel registrations rose 95% during that period
and, in 2005 alone, by 31%.
Even so, consumers shopping for diesels in 2007 have rather limited
choices, with just a handful of passenger vehicles on the market. But
that's slated to change in the next two years, as meaner, cleaner
models begin showing up on dealers' lots.
